As popular as this text might be, I do think that further work, further discussions are necessary, especially on the economic effects of this tax. And I think that we must, on this and on other files, think more also of the issue of competitiveness of the European financial industry.
I think we should not give the impression that financial institutions, banks, investment funds don’t pay taxes. Maybe we have to discuss in more coherent, comprehensive manner, whether the taxation is appropriate at a national level.
But on the issue of the Financial Transaction Tax, we have to do with transactions which, by their very nature, are cross-border. And therefore I do think that, although I can understand quite a number of arguments in favour of such a tax, that we should give more thought on the geographical scope, where such Financial Transaction Tax would apply.
I’m asking myself, is it wise, really, to apply such a tax in the EU, knowing that the US, China, Hong Kong, Singapore will not introduce such a tax? Is it wise to introduce such a tax in a limited number of European countries, knowing that the largest financial centre of Europe, i.e. London, will not introduce such a tax? I am referring to what George Osborne said in a public statement in this very group.
I must say that I tend to give a negative answer to those questions, because the risk of financial institutions just choosing to relocate their activities to a jurisdiction outside the scope of the FTT is probably there, or at least I think we should have more analysis of what the effect would be of a limited geographical scope in the application of such a tax.
I think we should focus on jobs and growth in the European Union. And therefore it’s not whether one is for or against this tax only, but also what will be the effects of such a tax, especially if the geographical scope is limited.
And therefore I can only suggest to the Presidency to have also in further meetings a broader political discussion about this.
The technical work, in my view, is not useful until and unless we have found a political solution and a political answer to some of the economic questions which I just raised.
And I hope that, in one of the further meetings, we can have more political discussions based, however, on a deeper economic analysis of the competitiveness of the financial industry in Europe, of jobs and growth as a consequence of the introduction of such a tax, which I have not seen to a satisfactory degree until now.